Meat industry, food system debated in supply chain comments | 2021-06-29


More workers and a more diverse food system, including small and medium-sized meat packers, are needed for U.S. agriculture to maintain resilience in the face of threats to the system, commentators told the USDA at the time. as the department embarks on its efforts to reimagine the country’s agricultural supply chains.

The USDA requested contributions in April, two months after President Joe Biden issued an executive order requiring the department to release a report by February 2022. The order came in the wake of the impacts of the COVID pandemic -19, which caused the collapse of some meat packing plants. closed and the milk to be discarded by dairy farmers.

The USDA has already tried to fix the problem, committing $ 4 billion to address supply chain issues, including funding for organic transition and the lack of small meat processing facilities.

“The COVID-19 pandemic has caused massive disruption for producers and food workers,” Agriculture Secretary Tom Vilsack said earlier this month. “It exposed a rigid, consolidated and fragile food system.”

During a comment period that ended last week, many organizations spoke about the meat supply and the impact of factories closed because of sick workers, one of the most enduring examples of the pandemic. The government, some said, must encourage the establishment of more small and medium-sized farms and allow small factories to reach more customers.

Agriculture Secretary Tom Vilsack

“In anticipation of future pandemic-type disruptions, significant vulnerabilities remain with a ‘just in time’ supply chain and a consolidated / centralized meat processing system,” he added. National Council of Agricultural Cooperatives mentionned. “They are still exposed to outbreaks of disease (human and animal) and are increasingly in a rush to implement traceability and automation. “

And the National Association of Beef Breeders said that “expanding national beef processing capacity is an important medium to long term strategy to improve the resilience of our supply chain,” but noted that existing infrastructure is underutilized.

“Most large slaughterhouses do not operate factories at 100% of their production capacity. Unfortunately, due to the proprietary nature of the firm-by-firm and plant-by-plant efficiency data, the exact number of hooks that are not used is unknown. NCBA urges USDA to consider ways to help industry achieve 100% processing capacity utilization. “

The issue of capacity also affects pricing and negotiations, the NCBA said.

“To improve the influence of producers in the feeder cattle negotiations, either the supply of cattle must be reduced or the processing capacity must be increased,” said the NCBA.

But the North American Meat Institute – which represents beef, pork, lamb, veal and turkey slaughterhouses and processors – opposed the idea that more capacity is needed to make the system more resilient. He pointed to the expansion of existing pork and beef production capacities in a few states, facilities which the group said were announced “in response to market forces.”

“Calls for smaller ‘regional’ factories as a way to build ‘resilience’ in the system do not align with sound economic thinking,” NAMI said, citing a report from Rabobank which said: “While many discussed the need for greater geographic dispersion, small factories, adding packaging capacity in the name of supply chain resilience is unlikely to work. It must be motivated by the long-term savings.

Disagreement emerged in comments on the success of a food safety and inspection service program created to allow state-inspected establishments to ship across state borders. NAMI said calls for legislation to allow these types of shipments ignore the existence of the FSIS Cooperative Interstate Shipping program.

“Nine states have chosen to participate in the program, two of which, Iowa and South Dakota, were announced during the COVID-19 pandemic,” NAMI said. “CIS was created by Congress as part of the 2008 Farm Bill and ensures that products transported in interstate commerce meet required food safety standards. CIS also guarantees a fair game for companies wishing to sell interstate commerce.

But the National Association of State Directors of Meat and Food Inspection looked at CIS and came to a different conclusion.

According to the USDA’s interpretation of the 2008 Farm Act, “any state meat or poultry inspection program must not only be” equal to “federal inspection, but must be conducted in same way as federal inspection in every factory in order to sell meat across state borders, ”says NASMFID. “As a result, more than a decade after the program was implemented by FSIS, only nine states are now participating in the CIS program, and in those states it is generally a minority of institutions that participate due to the charges. additional administrative burdens imposed on both the institution and the government program.

Problems meeting demand during the pandemic, the meat industry said, boiled down to work. Availability “has been affected by employees who became ill or infected, absenteeism caused by fear, and sometimes state or local health agencies,” NAMI said.

Packaging Plant Dividers

Many packing plants have installed barriers between workers during the COVID-19 pandemic. (Photo: Tyson)

“Going forward, not only must the industry be better prepared for future pandemics, but to help the supply chain, the USDA and other federal agencies and departments should work in coordination. [with] the National Association of Governors and organizations representing state legislatures to create a more uniform and cohesive response plan at the national and local levels.

“Meat packers of all sizes face similar operational challenges, the most consistent and serious of which is the recruitment and retention of the workforce,” the NCBA said, adding that the biggest hurdle at market entry is capital for construction.

“The average industry start-up cost for a meat processing facility is around $ 100,000 per hook,” the NCBA said, meaning that a “modest 25 head per day plant would need $ 2.5 million in funding just to build the infrastructure. ” The group called for the passage of legislation “allowing low-interest loans guaranteed by the federal government to future meat packers.”

Labor shortages, however, were a recurring theme in the comments. the The National Grains and Feed Association said the lack of workers “is the biggest supply chain constraint facing the grain and feed industry. NGFA members are unable to fill vacancies in the manufacturing, warehousing and transportation sectors. These shortages have a direct impact on the ability of our members to meet consumer demands.

The labor shortage extends to veterinarians, Texas Cattle Feeders Association said, a shortage that is due to retirements, a limited number of food animal graduates and the cost of becoming a veterinarian.

In addition to the meat’s conditioning capacity and widespread concern over labor shortages, commentators addressed a wide variety of other topics:

  • “Despite its importance, public funding for agricultural research in the United States is declining and critical areas of research relating to agroecology, sustainable food systems and sustainable diets are grossly underfunded.” – Union of concerned scientists
  • “One of the important steps USDA could take to ensure the continued functioning of the dairy supply chain during future pandemics would be to provide financial support to improve or expand cold storage capacity, including for frozen and deep-frozen products. “- International Dairy Association
  • Regarding the shortage of truck drivers, the Association of Agricultural Retailers said“While 48 states currently allow drivers to obtain a commercial driver’s license at age 18, they are prohibited from driving in interstate commerce until the age of 21. The DRIVE-Safe Act, which we support, would create a two-step apprenticeship program to enable these young drivers to enter the industry safely.
  • the Production alliance “Recommends that the federal government maintain a parallel and complementary Food Box program on an ongoing basis in coordination with the traditional food programs of the USDA. “
  • “The movement of seeds globally is based on the establishment of appropriate scientific and risk-based standards for phytosanitary rights, intellectual property rights, crop protection and breeding techniques. ” the American Seed Trade Association “Encourages the creation and adoption of global standards to ensure that the needs and concerns of ASTA members are taken into account. “
  • “Increase federal investments to modernize locks and dams on U.S. waterways – particularly those on the upper Mississippi River and the Illinois River system – and fully [utilize] the Harbor Maintenance Trust Fund for the purpose of dredging US harbors and harbors. “- National Association of Grains and Animal Feed
  • “From the early days of the pandemic, we had to closely monitor and use emergency orders and regulations issued by federal agencies such as the Department of Transportation and the Federal Motor Carrier Safety Administration to the offices of governors of the United States. States and driver licensing agencies. The biggest and most beneficial changes have focused on the following areas: 1.) shorter hours of service, 2.) increased size and weight of trucks, and 3.) commercial driver’s license extensions ( CDL) expired and expiring and other certifications. “- IMF-Food Industry Association

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